Guarantor and Non-Guarantor Financial Information

The following condensed consolidating financial information for Piedmont Operating Partnership, L.P. (the "Issuer"), Piedmont Office Realty Trust, Inc. (the "Guarantor"), and the other directly and indirectly owned subsidiaries of the Guarantor (the "Non-Guarantor Subsidiaries") is provided pursuant to the requirements of Rule 3-10 of Regulation S-X regarding financial statements of guarantors and issuers of guaranteed registered securities. The Issuer is a wholly-owned subsidiary of the Guarantor, and all guarantees by the Guarantor of securities issued by the Issuer are full and unconditional. The principal elimination entries relate to investments in subsidiaries and intercompany balances and transactions, including transactions with the Non-Guarantor Subsidiaries.



Condensed Consolidated Balance Sheets
As of December 31, 2016
(in thousands)	Issuer		Guarantor			Non-Guarantor Subsidiaries		Eliminations			Consolidated
Assets:
Real estate assets, at cost:
Land	$	46,133	$	—		$	623,715	$	—		$	669,848
Buildings and improvements, less accumulated depreciation	228,194		—			2,699,430		(300		)	2,927,324
Intangible lease assets, less accumulated amortization	725		—			98,970		—			99,695
Construction in progress	145		—			34,680		—			34,825
Total real estate assets	275,197		—			3,456,795		(300		)	3,731,692
Investments in and amounts due from unconsolidated joint ventures	7,360		—			—		—			7,360
Cash and cash equivalents	3,674		150			3,168		—			6,992
Tenant and straight-line receivables, net	20,159		—			172,183		—			192,342
Advances to affiliates	6,406,581		1,315,616			—		(7,722,197		)	—
Investment in subsidiary	—		3,630,564			181		(3,630,745		)	—
Notes receivable	88,910		—			95,790		(184,700		)	—
Prepaid expenses, restricted cash, escrows, and other assets	6,189		—			20,575		(1,897		)	24,867
Goodwill	180,097		—			—		—			180,097
Deferred lease costs, net	16,550		—			289,447		—			305,997
Total assets	$	7,004,717	$	4,946,330		$	4,038,139	$	(11,539,839	)	$	4,449,347
Liabilities:
Debt, net	$	1,701,933	$	—		$	503,242	$	(184,700	)	$	2,020,475
Accounts payable, accrued expenses, dividends payable, and accrued capital expenditures	17,365		31,230			118,712		(1,897		)	165,410
Advances from affiliates	708,340		5,071,521			2,040,592		(7,820,453		)	—
Deferred income	5,206		—			23,200		—			28,406
Intangible lease liabilities, net	—		—			48,005		—			48,005
Interest rate swaps	8,169		—			—		—			8,169
Total liabilities	2,441,013		5,102,751			2,733,751		(8,007,050		)	2,270,465
Stockholders’ Equity:
Common stock	—		1,452			—		—			1,452
Additional paid-in capital	3,626,564		3,676,000			1,309		(3,630,745		)	3,673,128
Retained/(cumulative distributions in excess of) earnings	935,036		(3,833,873		)	1,301,197		97,956			(1,499,684		)
Other comprehensive loss	2,104		—			—		—			2,104
Piedmont stockholders’ equity	4,563,704		(156,421		)	1,302,506		(3,532,789		)	2,177,000
Noncontrolling interest	—		—			1,882		—			1,882
Total stockholders’ equity	4,563,704		(156,421		)	1,304,388		(3,532,789		)	2,178,882
Total liabilities and stockholders’ equity	$	7,004,717	$	4,946,330		$	4,038,139	$	(11,539,839	)	$	4,449,347



Condensed Consolidated Balance Sheets
As of December 31, 2015
(in thousands)	Issuer		Guarantor			Non-Guarantor Subsidiaries		Eliminations			Consolidated
Assets:
Real estate assets, at cost:
Land	$	54,459	$	—		$	621,632	$	—		$	676,091
Buildings and improvements, less accumulated depreciation	270,057		—			2,567,706		(300		)	2,837,463
Intangible lease assets, less accumulated amortization	1,268		—			83,395		—			84,663
Construction in progress	240		—			20,735		—			20,975
Real estate assets held for sale, net	76,614		—			—		—			76,614
Total real estate assets	402,638		—			3,293,468		(300		)	3,695,806
Investments in and amounts due from unconsolidated joint ventures	7,577		—			—		—			7,577
Cash and cash equivalents	2,174		150			3,117		—			5,441
Tenant and straight-line rent receivables, net	23,738		—			149,994		—			173,732
Advances to affiliates	6,073,606		1,251,530			—		(7,325,136		)	—
Investment in subsidiary	—		3,752,523			186		(3,752,709		)	—
Notes receivable	134,750		—			23,890		(113,240		)	45,400
Prepaid expenses, restricted cash, escrows, and other assets	7,091		—			24,118		(1,258		)	29,951
Goodwill	180,097		—			—		—			180,097
Deferred lease costs, net	20,939		—			267,102		—			288,041
Other assets held for sale, net	8,490		—			—		—			8,490
Total assets	$	6,861,100	$	5,004,203		$	3,761,875	$	(11,192,643	)	$	4,434,535
Liabilities:
Debt, net	$	1,552,007	$	—		$	590,743	$	(113,240	)	$	2,029,510
Accounts payable, accrued expenses, and accrued capital expenditures	18,954		580			110,189		(1,258		)	128,465
Advances from affiliates	580,526		5,033,266			1,788,840		(7,402,632		)	—
Deferred income	5,905		—			21,365		—			27,270
Intangible lease liabilities, net	—		—			42,853		—			42,853
Interest rate swaps	9,993		—			—		—			9,993
Total liabilities	2,167,385		5,033,846			2,553,990		(7,517,130		)	2,238,091
Stockholders’ Equity:
Common stock	—		1,455			—		—			1,455
Additional paid-in capital	3,748,524		3,672,849			1,314		(3,752,710		)	3,669,977
Retained/(cumulative distributions in excess of) earnings	943,530		(3,703,947		)	1,205,546		77,197			(1,477,674		)
Other comprehensive loss	1,661		—			—		—			1,661
Piedmont stockholders’ equity	4,693,715		(29,643		)	1,206,860		(3,675,513		)	2,195,419
Noncontrolling interest	—		—			1,025		—			1,025
Total stockholders’ equity	4,693,715		(29,643		)	1,207,885		(3,675,513		)	2,196,444
Total liabilities and stockholders’ equity	$	6,861,100	$	5,004,203		$	3,761,875	$	(11,192,643	)	$	4,434,535



Condensed Consolidated Statements of Income
For the year ended December 31, 2016
(in thousands)	Issuer			Guarantor			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Rental income	$	55,007		$	—		$	407,514		$	(2,631	)	$	459,890
Tenant reimbursements	14,081			—			80,378			(498		)	93,961
Property management fee revenue	—			—			16,897			(15,033		)	1,864
	69,088			—			504,789			(18,162		)	555,715
Expenses:
Property operating costs	31,967			—			205,344			(18,377		)	218,934
Depreciation	16,657			—			111,076			—			127,733
Amortization	3,715			—			71,404			—			75,119
Impairment loss on real estate assets	5,972			—			24,926			—			30,898
General and administrative	28,314			311			36,065			(35,446		)	29,244
	86,625			311			448,815			(53,823		)	481,928
Real estate operating income/(loss)	(17,537		)	(311		)	55,974			35,661			73,787
Other income (expense):
Interest expense	(49,108		)	—			(27,636		)	11,884			(64,860		)
Other income/(expense)	9,560			282			2,029			(11,884		)	(13		)
Net recoveries from casualty events and litigation settlements	—			—			34			—			34
Equity in income of unconsolidated joint ventures	362			—			—			—			362
	(39,186		)	282			(25,573		)	—			(64,477		)
Income/(loss) from continuing operations	(56,723		)	(29		)	30,401			35,661			9,310
Gain on sale of real estate assets	33,326			—			65,236			—			98,562
Net income/(loss)	(23,397		)	(29		)	95,637			35,661			107,872
Less: Net loss applicable to noncontrolling interest	—			—			15			—			15
Net income/(loss) applicable to Piedmont	$	(23,397	)	$	(29	)	$	95,652		$	35,661		$	107,887



Condensed Consolidated Statements of Income
For the year ended December 31, 2015
(in thousands)	Issuer			Guarantor			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Rental income	$	67,317		$	—		$	404,460		$	(2,905	)	$	468,872
Tenant reimbursements	13,340			—			100,955			(414		)	113,881
Property management fee revenue	—			—			17,801			(15,785		)	2,016
	80,657			—			523,216			(19,104		)	584,769
Expenses:
Property operating costs	36,380			—			225,428			(19,786		)	242,022
Depreciation	20,891			—			113,612			—			134,503
Amortization	4,598			—			56,288			—			60,886
Impairment loss on real estate assets	5,354			—			34,815			—			40,169
General and administrative	29,645			341			35,923			(35,563		)	30,346
	96,868			341			466,066			(55,349		)	507,926
Real estate operating income/(loss)	(16,211		)	(341		)	57,150			36,245			76,843
Other income (expense):
Interest expense	(51,704		)	—			(33,540		)	11,246			(73,998		)
Other income/(expense)	12,600			—			211			(11,246		)	1,565
Net recoveries/(loss) from casualty events and litigation settlements	23			—			(301		)	—			(278		)
Equity in income of unconsolidated joint ventures	553			—			—			—			553
	(38,528		)	—			(33,630		)	—			(72,158		)
Income/(loss) from continuing operations	(54,739		)	(341		)	23,520			36,245			4,685
Discontinued operations:
Operating income	15			—			69			—			84
Loss on sale of real estate assets	(1		)	—			—			—			(1		)
Income from discontinued operations	14			—			69			—			83
Gain on sale of real estate assets	53,795			—			114,442			—			168,237
Net income/(loss)	(930		)	(341		)	138,031			36,245			173,005
Less: Net income applicable to noncontrolling interest	—			—			(15		)	—			(15		)
Net income/(loss) applicable to Piedmont	$	(930	)	$	(341	)	$	138,016		$	36,245		$	172,990



Condensed Consolidated Statements of Income
For the year ended December 31, 2014
(in thousands)	Issuer			Guarantor			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Rental income	$	72,843		$	—		$	386,995		$	(5,203	)	$	454,635
Tenant reimbursements	16,566			—			93,516			(534		)	109,548
Property management fee revenue	—			—			16,516			(14,447		)	2,069
	89,409			—			497,027			(20,184		)	566,252
Expenses:
Property operating costs	42,621			—			217,786			(20,976		)	239,431
Depreciation	23,512			—			115,084			—			138,596
Amortization	4,754			—			51,825			—			56,579
General and administrative	23,235			300			28,232			(27,942		)	23,825
	94,122			300			412,927			(48,918		)	458,431
Real estate operating income/(loss)	(4,713		)	(300		)	84,100			28,734			107,821
Other income (expense):
Interest expense	(47,355		)	—			(39,625		)	12,534			(74,446		)
Other income/(expense)	11,944			—			652			(12,534		)	62
Net recoveries from casualty events and litigation settlements	1,322			1,479			4,191			—			6,992
Equity in loss of unconsolidated joint ventures	(350		)	—			—			—			(350		)
	(34,439		)	1,479			(34,782		)	—			(67,742		)
Income/(loss) from continuing operations	(39,152		)	1,179			49,318			28,734			40,079
Discontinued operations:
Operating income	913			—			41			—			954
Gain on sale of real estate assets	450			—			748			—			1,198
Income from discontinued operations	1,363			—			789			—			2,152
Gain on sale of real estate assets	—			—			1,132			—			1,132
Net income/(loss)	(37,789		)	1,179			51,239			28,734			43,363
Less: Net income applicable to noncontrolling interest	—			—			(15		)	—			(15		)
Net income/(loss) applicable to Piedmont	$	(37,789	)	$	1,179		$	51,224		$	28,734		$	43,348



Condensed Consolidated Statements of Cash Flows
For the year ended December 31, 2016
(in thousands)	Issuer			Guarantor			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Net Cash Provided By/(Used In) Operating Activities	$	(26,260	)	$	5,214		$	221,195		$	35,660		$	235,809

Cash Flows from Investing Activities:
Investment in real estate assets, consolidated joint venture, and real estate related intangibles, net of accruals	(5,060		)	—			(454,836		)	—			(459,896		)
Intercompany note receivable	440			—			(71,900		)	71,460			—
Net sales proceeds from wholly-owned properties	200,220			—			165,698			—			365,918
Deferred lease costs paid	(2,758		)	—			(23,138		)	—			(25,896		)
Net cash provided by/(used in) investing activities	192,842			—			(384,176		)	71,460			(119,874		)
Cash Flows from Financing Activities:
Debt issuance costs paid	(264		)	—			—			—			(264		)
Proceeds from debt	695,000			—			—			—			695,000
Repayments of debt	(538,000		)	—			(168,875		)	—			(706,875		)
Intercompany note payable	(9,600		)	—			81,060			(71,460		)	—
Costs of issuance of common stock	—			(342		)	—			—			(342		)
Shares withheld to pay tax obligations related to employee stock compensation	—			(2,344		)	—			—			(2,344		)
Repurchases of common stock as part of announced plan	—			(7,943		)	—			—			(7,943		)
(Distributions to)/repayments from affiliates	(312,218		)	97,016			250,862			(35,660		)	—
Dividends paid and discount on dividend reinvestments	—			(91,601		)	(15		)	—			(91,616		)
Net cash provided by/(used in) financing activities	(165,082		)	(5,214		)	163,032			(107,120		)	(114,384		)
Net increase in cash and cash equivalents	1,500			—			51			—			1,551
Cash and cash equivalents, beginning of year	2,174			150			3,117			—			5,441
Cash and cash equivalents, end of year	$	3,674		$	150		$	3,168		$	—		$	6,992



Condensed Consolidated Statements of Cash Flows
For the year ended December 31, 2015
(in thousands)	Issuer			Guarantor			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Net Cash Provided By/(Used In) Operating Activities	$	(27,077	)	$	4,699		$	205,177		$	36,245		$	219,044

Cash Flows from Investing Activities:
Investment in real estate assets, consolidated joint venture, and real estate related intangibles, net of accruals	(12,203		)	—			(489,241		)	—			(501,444		)
Intercompany note receivable	72,000			—			—			(72,000		)	—
Redemption of noncontrolling interest in unconsolidated variable interest entity	—			—			(4,000		)	—			(4,000		)
Net sales proceeds from wholly-owned properties	151,557			—			696,612			—			848,169
Deferred lease costs paid	(3,792		)	—			(33,891		)	—			(37,683		)
Net cash provided by/(used in) investing activities	207,562			—			169,480			(72,000		)	305,042
Cash Flows from Financing Activities:
Debt issuance costs paid	(575		)	—			(506		)	—			(1,081		)
Proceeds from debt	1,142,577			—			159,281			—			1,301,858
Repayments of debt	(1,438,000		)	—			(106,301		)	—			(1,544,301		)
Intercompany note payable	—			—			(72,000		)	72,000			—
Costs of issuance of common stock	—			(326		)	—			—			(326		)
Shares withheld to pay tax obligations related to employee stock compensation	—			(1,710		)	—			—			(1,710		)
Repurchases of common stock as part of announced plan	—			(158,860		)	—			—			(158,860		)
(Distributions to)/repayments from affiliates	109,544			281,073			(354,372		)	(36,245		)	—
Dividends paid and discount on dividend reinvestments	—			(126,516		)	(15		)	—			(126,531		)
Net cash provided by/(used in) financing activities	(186,454		)	(6,339		)	(373,913		)	35,755			(530,951		)
Net increase/(decrease) in cash and cash equivalents	(5,969		)	(1,640		)	744			—			(6,865		)
Cash and cash equivalents, beginning of year	8,143			1,790			2,373			—			12,306
Cash and cash equivalents, end of year	$	2,174		$	150		$	3,117		$	—		$	5,441



Condensed Consolidated Statements of Cash Flows
For the year ended December 31, 2014
(in thousands)	Issuer			Guarantor			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Net Cash Provided by Operating Activities	$	5,448		$	4,088		$	178,889		$	28,733		$	217,158

Cash Flows from Investing Activities:
Investment in real estate assets, consolidated joint venture, and real estate related intangibles, net of accruals	(23,541		)	—			(267,918		)	—			(291,459		)
Intercompany note receivable	650			—			—			(650		)	—
Net sales proceeds from wholly-owned properties	29,519			—			16,713			—			46,232
Net sales proceeds received from unconsolidated joint ventures	6,017			—			—			—			6,017
Investments in unconsolidated joint ventures	(42		)	—			—			—			(42		)
Deferred lease costs paid	(4,472		)	—			(23,222		)	—			(27,694		)
Net cash provided by/(used in) investing activities	8,131			—			(274,427		)	(650		)	(266,946		)
Cash Flows from Financing Activities:
Debt issuance costs paid	(1,294		)	—			—			—			(1,294		)
Proceeds from debt	1,052,527			—			—			—			1,052,527
Repayments of debt	(238,000		)	—			(575,702		)	—			(813,702		)
Discount due to loan modification	(1,135		)	—			—			—			(1,135		)
Intercompany note payable	—			—			(650		)	650			—
Shares withheld to pay tax obligations related to employee stock compensation	—			(1,275		)	—						(1,275		)
Repurchases of common stock as part of announced plan	—			(54,802		)	—			—			(54,802		)
(Distributions to)/repayments from affiliates	(820,795		)	178,812			670,716			(28,733		)	—
Dividends paid and discount on dividend reinvestments	—			(125,183		)	(15		)	—			(125,198		)
Net cash provided by/(used in) financing activities	(8,697		)	(2,448		)	94,349			(28,083		)	55,121
Net increase/(decrease) in cash and cash equivalents	4,882			1,640			(1,189		)	—			5,333
Cash and cash equivalents, beginning of year	3,261			150			3,562			—			6,973
Cash and cash equivalents, end of year	$	8,143		$	1,790		$	2,373		$	—		$	12,306